Strategy for the Telecommunications, Media and Technology industries

The state of mobile in Australia: Highlights and implications from Deloitte’s Mobile Consumer Survey

2017 marks the 10th anniversary of the iPhone. Reflecting on the decade past, it is clear that Australians have enthusiastically embraced the smartphone and its many uses with consumers and businesses being the beneficiary of this era-defining technology. As mobility continues to mature beyond today’s smartphones into new more powerful devices or the mass adoption of wearables and drones it is important for businesses to stay across the trends in mobility and their implications for product strategies, innovation, customer experience, content and operations.

Deloitte’s Mobile Consumer Survey, now in its fourth year, is a multi-country study of mobility around the world. The 2017 study comprises more than 51,500 responses across 33 countries. The Australian edition is based on 2,000 national responses from consumers aged 18-75 polled during May and June 2017. Special mention to the team that prepares this report in Australia led by Jeremy Drumm, Nick White, Morne Swiegers and Maggie Davey.

This post draws out a number of the key findings from the 2017 Australian edition of Deloitte’s Mobile Consumer Survey and the implications for Australian businesses. The full report is insightful for those in leadership and management roles in Australia’s carriers/operators, RSPs or businesses looking to further understand how to capture the value of mobility to their organisation.

‘Silver surfers power smartphone swell’ (p.7)

It may come as no surprise that smartphone ownership is on the rise for older generations – 78% of 65-75 year olds now own a smartphone which is up almost 10% on last years’ figure. With the decommissioning of the 2G network a portion of the population have left behind their feature phones and in 2017 88% of Australian’s own a smartphone. It is expected that in the coming 18 months 90-95% of Australian’s will own a smartphone as older generations continue to adopt and embrace this technology.

Implications

We are reaching saturation in smartphone ownership which means device manufacturers will need to continue to innovate to profit from replacement/market share vs growth from new adoption. For businesses looking to reach older generations, now is the time to seriously consider the mobile experience (sales/service) for the elderly.

‘A slice of Apple’s pie’ (p.8)

Australians are Apple and Samsung junkies. We have the second highest % penetration of Apple and Samsung smartphones in the countries surveyed at 75% – only Luxemburg at 83% is higher. Interestingly, Samsung’s share has increased slightly YoY and Apple’s share has decreased by 2% all in a period which included the Galaxy note safety recall. The data in the survey correlates to users of Samsung Galaxy (S6-8) and iPhone (6-7) models. It will be interesting to see the change in next year’s data with the iPhone X (most expensive smartphone ever) and SIM enabled watch (Do i still need a smartphone?) adding new dimensions to smartphone ownership.

Implications

Australian’s are clearly premium smartphone buyers but we can expect the ~$AUD 2,000 iPhone X test Australian’s love for the brand as well as the growing number of competitive (tech and $ price) Android devices (e.g. Pixel 2, Huawei P10). I suspect this mix to change again next year perhaps with the non-Apple/Samsung smartphone brands gaining more mind and wallet share.

‘Demanding data divas’ (p.13)

Australians are purchasing more data in 2017 than ever before – 60% of Australians now have a data limit 3GB or higher. Interestingly, those that have between 3-5GB plans are 2x more likely to exceed their data limit than those with 500MB or less. The report estimates those who exceed their data collectively to pay close to $30M per month or $313M per year for extra data.

Implications

Australians are data hungry. This is following a growing trend seen around the world. The obvious long term implication is that the operators that can provide the most data at an affordable rate will win and already a number of global carriers are offering unlimited plans. Operators will need to look to improve their cost base in order to remain competitive in an unlimited world. Equally, customer experience will begin to play more of a role as operators try to maintain quality connections across their network.

‘WiFi wins…this round’ (p.19)

Australians are more likely to connect to WiFi in 2017 than 4G despite 86% of people being on 4G. This is believed to be the result of the current cost of mobile data plans rather than connectivity needs (e.g. speed) – only 40% of consumers identified that 4G is faster than their home speed.

Implications

This WiFi vs Mobile connectivity is a hotly debated topic in Australia currently. The reality is that it is more likely to be complementary rather that one replacing the other. The introduction of devices like ‘hybrid’ modems and ‘broadband plans’ to households are likely to reduce consumers concerns over the utility of one network or another. Bottom line, consumers and businesses want to be connected and to be able to access content, technology and services – in a world of ubiquitous connection, the type of network a consumer connects onto (e.g. WiFi, Mobile, Mesh) will likely be an afterthought.

‘High street hangs in’ (p.20)

1 in 5 consumers visited an operator store in the last month and 3 in 5 in the last year. Stores are still important for operators especially for testing physical product and technical support. The cross channel stat – 23% of smarthphones (mostly by 35-44 year olds – 30%) were purchased online but only 3% of these were collected in the operator store – more scope for omni-channel experience.

Implications

Face to face and physical interactions with customers are still important particularly for operators – there is value in face to face exploration, sales, service and support interactions. Whilst there is a lot of information online and the channels to service customers the increasing pace of device innovation, new technologies and solutions is creating a complex environment for many to navigate. Stores will continue to deliver value particularly when aligned to a coherent and compelling omni-channel strategy.

‘Our homes are getting smarter’ (p.33)

Ownership and access to connected devices in the home is on the rise. In the last year there have been increased purchases of cameras (9%), connected car systems (8%) and connected home appliances (5%). The popularity of home security systems seems to indicate consumers value connected home devices for increased security and convenience. There is also a clear preference for devices that are easily self-installed such as smart lighting.

Implications

These findings indicate that in the short to mid term bets in smart home IoT are best placed on products that have a clear customer benefit, short replacement cycle and are easily self-installed. More complicated home device set ups will require support to enable. Operators looking to provide consumer IOT solutions need to look carefully into the set up and support model (and cost) as part of the business case for mass-consumer IOT installations.

‘Seamless shopping on the go’ (p.44)

Mobile payment solutions are up 14% from 2016 with over 25% of respondents suggesting they now use the mobile payment solutions. Pay Pal has taken a hit in this survey which is likely due to the fact that tap and go payments from the iOS app. Apple Pay is therefore increasingly popular accounting for 18% of mobile payments nudging out Samsung Pay at 12%.

Implications

There is still room for growth in mobile payments in Australia with solutions going beyond early adopters. There is increasing value in developers creating seamless experiences combining mobile applications and payments for fast purchasing on the go. App developers and online channels should look to include mobile payment options online and retail stores should look to include tap and go options where possible in the next 18 months.

The bottom line

Australian’s are high on the adoption curve for smartphones globally, we are consuming more data now than ever and we are using our devices everywhere and at anytime. Devices are becoming more innovative some innovations are getting our attention like fingerprint security (35% increase on 2016) and mobile payments (25% increase on 2016) but we still don’t care much (yet) for voice assistants.